Milk industry sounds the alarm as India's production growth sees steep fall

India, the world’s largest producer of milk, is seeing a slowing of its rate of growth in production, latest data showed. Annual growth rate in milk production which has slowed from 3.83 per cent in FY23 to 3.78 per cent in 2023-24 fiscal, though the country continues to remain the world’s largest producer, with 239.3 million tonnes annually. 

 

The growth rate in milk production was 6.62 per cent in 2017-18; 6.47 per cent in FY19; 5.69 per cent in FY20; 5.81 per cent in FY21; and 5.77 per cent in FY22. 

 

The drop in growth has raised alarm bells within a section of the industry, with some attributing it to structural challenges that the country’s dairy sector faces while others say it is a one-off event due to COVID-led disruption in interventions such an artificial insemination as well as a poor monsoon in 2023. 

 

Low rains are sometimes directly linked to milk production because a good monsoon means abundant availability of green fodder, besides an increase in production of crops that go into making feedmeal. 

 

The data also shows that while milk production from exotic and crossbred cattle has risen by 8 per cent in FY24 so far as compared to the same period last fiscal, output from indigenous and non-descript cattle has risen by 45 per cent. However, milk from buffaloes has fallen by almost 16 per cent in FY24 compared to FY23. Buffaloes (both indigenous and non-descript) contributed almost 45 per cent to the total milk production of 239.3 million tonnes in FY24. Consequently, any drop in buffalo milk production is bound to impact overall output.  

 

The slowing of growth in two consecutive fiscal years is also raising concerns over whether India’s milk production is rising increasingly simply because of the number of cattle, given that milk yield per animal is barely growing. 

 

Government data shows that average yield from exotic and cross-bred cattle in FY-24 was 8.12 kgs per day per animal, but only 4.01 kgs per day per animal for indigenous and non-descript animals. 

 

Worryingly, if the growth rate continues to slow or remain stagnant, it could lead to a situation where demand outstrips total annual milk production. 

 

According to some experts, since the so-called ‘White Revolution’ - when India’s milk production grew exponentially – milk production has been doubling every 15 years. If growth continues to slow, that target may also become unachievable.  

 

Cattle Population vs Yield  

 

India’s cattle population (both cows and buffaloes) numbers around 303 million as per the 2019 livestock census. While the aggregate number is the highest in the world, India is much lower than the world average in terms of per-animal yield. 

 

As per Integrated Sample Survey, the average annual productivity of cattle in India during fiscal 2019-20 was 1,777 kg per animal per year, a good 52 per cent below the global average of 2,699 kg per animal per year during 2019 (as per UN’s Food and Agriculture Organisation). 

 

However, the average productivity of cattle has increased by around 28 per cent between 2013-14 and 2019-20 which is the highest increase in productivity worldwide. 

 

Another data point shows that India is ranked almost 15th in the world when it comes to per animal milk yields, with the US at the top. India is close to Pakistan (which follows an almost similar dairy animal rearing system as India). 

 

There are multiple reasons for this low yield, low productivity conundrum. The biggest among them are the small size of animal herds that farmers keep, and declining average land holding. The average animal herd size in India, as per some reports, is just about 2-4 animals, while it is much more elsewhere in the world. 

 

Additionally, the per hectare land holding is just around 1.08 hectares as per the last census, and which has reduced to 0.78 hectares as per the latest NABARD survey. 

 

Further, experts said the rising cost of producing milk due to a spike in fodder rates, along with limited access to technology despite multiple efforts by both government and private agencies, are among other reasons for India’s low input, low output model of dairy farming. 

 

Rahul Kumar, chief operating officer of Parag Milk Foods Ltd, says that, more than anything else, it is the low and fluctuating milk prices, cost of production (much more than global peers), and shrinking resources such as water, land and fodder that keep a farmer from investing in improving milk yields. 

 

“I also feel that the younger generation is reluctant to come into dairying in a big way which also is a reason for low per animal yield in India,” Kumar said. 

 

He said multiple efforts are needed to be taken at all levels to reverse this trend which should start right from the education level and goes right up to advanced fodder concentrates, cutting-edge technological innovation, scientifically-designed cattle feed, and a centralised database of Artificial Insemination (AI), among other things. 

 

“I have been saying this for a long time, that now the time has come to look deeply at per animal yield and not just production growth,” said Tarun Shridhar, former secretary to the government of India and Director General of Indian Chamber of Food and Agriculture. “We should not be just contending with producing more but producing more from fewer animals or the same number of animals.”  

 

Government Steps 

 

For its part, the government has also been taking steps to reverse this trend. The Centre's ambitious Rashtriya Gokul Mission aims to boost India's milk production and productivity through a host of interventions to supplement efforts made by states and union territories. 

 

The Mission, as per a recent statement made in Parliament, aims to expand artificial insemination coverage to boost milk production and productivity of bovines, including indigenous breeds. As of date, 7.3 crore animals have been covered, with 10.17 crore artificial inseminations performed, benefiting 4.58 crore farmers. 

 

The insemination facilities are available free of cost and are provided at farmers’ homesteads. Rural youth are specifically trained for this purpose. 

 

That apart, the mission also aims to produce high genetic merit bulls, including those of indigenous breeds. Progeny testing is implemented for Gir and Sahiwal breeds of cattle, and Murrah and Mehsana breeds of buffaloes. 

 

Under the pedigree selection programme, Rathi, Tharparkar, Hariana, and Kankrej breeds of cattle, and Jaffarabadi, Nili Ravi, Pandharpuri and Banni breeds of buffalo are covered. So far 3,988 high genetic merit bulls have been produced and inducted for semen production, the Parliamentary reply said. 

 

The department of animal husbandry has also established sex-sorted semen production facilities at five government semen stations across Gujarat, Madhya Pradesh, Tamil Nadu, Uttarakhand, and Uttar Pradesh. 

 

Three private semen stations are also producing sex-sorted semen doses and so far, 1.12 crore such doses have been produced and made available for artificial insemination. 

 

Also, in order to propagate elite animals of indigenous breeds, the department has established 22 IVF laboratories and has produced 22,896 viable embryos, with 12,846 embryos transferred and 2,019 calves born. 

 

To accelerate genetic improvement of cattle and buffaloes, the government has developed unified genomic chips — ‘Gau Chip’ for indigenous cattle and ‘Mahish Chip’ for buffaloes —specifically designed for initiating genomic selection in the country. 

 

As part of the Gokul Mission, dairy farmers also receive support for assured pregnancy up to 50 per cent of the cost of sex-sorted semen; so far, 341,998 farmers have been benefited from this programme. 

 

For IVF, farmers get an incentive of Rs 5,000 per assured pregnancy. They can also avail of programmes to improve fodder, animal feed, and obtain credit.